How might the XRP and SEC case affect other ongoing or pending litigation?
Lilia Tessler, a key figure in Sidley's fintech and blockchain practice, recently discussed the ongoing legal battles between the cryptocurrency industry and the SEC. During a recent discussion about enforcement actions, she spoke about the chaotic nature of the situation.
The SEC has actively targeted various cryptocurrency projects and exchanges. However, the industry is starting to push back, companies have filed SEC lawsuits. The central argument of these companies is that the regulatory framework is not clear, and they demand more clear guidance. Instead of facing constant legal challenges, they believe that the rules to be followed should be clearer.
On The Thinking Crypto podcast, when asked if she's seen something similar in other industries, Tesler said the situation is very unique. The fintech and blockchain sectors are experiencing unexpected SEC enforcement actions, particularly in areas where there is little regulatory guidance or regulation. This lack of transparency has led to pushback from the industry, with many players actively involved in litigation against the SEC.
As SEC Vs. Ripple and other similar lawsuits have also been discussed. The interviewer recalls that her company previously filed an amicus brief with the Digital Commerce Chamber in support of Ripple in the XRP lawsuit. Recently, Judge Torres ruled that XRP itself is not a security and that secondary market sales of XRP do not constitute securities transactions.
Responding to the same, she said, “The signs themselves may not be securities. So we are starting to see the courts adopt some of the existing case law one by one, and it will be interesting to see how it develops in other pending cases.
